The short-listed potential suitors for a majority stake in troubled Greek flag-carrier Olympic Airways were forced to re-submit their bids in mid-June, after Credit Suisse First Boston (CSFB) decided that the original bids did not comply with the terms laid out by the Greek Government. Although reasons were not given, it is believed that the government baulked at some of the caveats included in the bids and the guarantees sought, especially regarding the airline's debts, thought to be around $135 million.
The rebid has given another chance to Australia's Capital Integrated Airline Solutions, which missed the original deadline, to challenge front runners Cyprus Airways and the powerful local Axon Group. The latter has its own airline, Axon Airlines, operating a small European network. The fourth bidder is the Restis Group headed by Greek shipping magnate Stimitas Restis. An initial 51% majority stake is on offer, with an option for a further 16% at a later stage. Cyprus Airways, which sees some synergies and a readymade opportunity to expand its market influence in the Eastern Mediterranean, is hopeful of a successful outcome, says Christos Kyriakides, Cyprus general manager
Once the selection is made, with an announcement expected within weeks, the preferred bidder will have to convince the powerful Olympic unions, which are vehemently opposed to privatisation, that a new mode of operation has to be implemented if Olympic is to be made viable.
One of the conditions of all bids is that the preferred bidder will immediately sit down with the unions, but if no agreement is reached, says Kyriakides, "he is free to walk away from the deal". The bottom line seems to be that the unions hold the key to the Greek carrier's future, as they have done in the past.
Source: Airline Business
